The Spice And Tea Exchange
The Spice & Tea Exchange offers retail stores selling spices, herbs, teas, and related products. Known for a wide variety of flavors and blends, it operates in the food and beverage retail sector.
The Spice And Tea Exchange franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment required to begin operation of a single The Spice & Tea Exchange franchise ranges from $298,560 to $532,150. This amount includes payments to the franchisor or affiliates and does not include potential costs for purchasing real estate or constructing a building [p.1, p.21].
What is the initial franchise fee?
The initial franchise fee is $38,750 and it is due in a lump sum payment on the Agreement Date [p.10, p.107]. This fee is non-recurring and non-refundable upon payment [p.10].
What are the ongoing royalty and advertising fees?
The ongoing royalty fee is 7% of your Store's monthly Gross Sales, with a minimum of $1,750 per month [p.107]. Advertising expenses are expensed as incurred by the company; for the years ended December 31, 2024, 2023, and 2022, these expenses were $31,310, $40,864, and $29,507, respectively [p.81].
How long is the initial franchise agreement, and can I renew it?
The initial franchise agreement typically does not specify a fixed term length. However, you have the right to renew the agreement for four successive, additional five-year periods, provided you meet certain conditions [p.100].
Can I sell or transfer my franchise, and what does that require?
The franchisor can refuse to permit a transfer of ownership of your franchise except for good cause. Good cause includes but is not limited to unspecified factors [p.214(g)]. This restriction may be subject to the franchisor's right of first refusal to purchase the franchise [p.214(g)].
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the agreement if the franchisee fails to comply with lawful provisions of the franchise agreement and does not cure such failure within a reasonable time frame [p.214], or if the franchisee does not use Approved Suppliers or follow System Standards, as specified in [p.24]. Additionally, termination is permitted on any grounds available by law [p.220]. This isn't specified in the excerpts for other specific grounds.
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts.
Do I get an exclusive or protected territory?
No, you do not receive an exclusive territory. You have a protected area within a market area where you can operate your store, but you may face competition from other franchisees, outlets owned by the company, or other competitive brands [p.37]. This protected area is generally a one-mile radius around your specific location, though it can be smaller in urban areas [p.36].
What training and ongoing support does the franchisor provide?
The franchisor provides initial training through Spice UniversiTea, which consists of between 28 and 49 hours of classroom training, and On-Site Training, offering between 66 to 101 man-hours of assistance during store opening. Ongoing support includes access to Manuals and general assistance as specified in the agreement [p.172]. For transferee franchisees, the franchisor may provide a modified version of the initial training program at its discretion [p.35, p.110].
How many franchised outlets are there, and how many have closed or been terminated?
This isn't specified in the excerpts.
Does the franchisor share any financial performance or earnings information?
The franchisor does not make any financial performance representations except for providing actual records of an existing outlet if you are purchasing one. However, they do include certain historical data submitted by franchisees [p.54-55], though this information is not audited or independently verified. If you receive any other financial performance information or projections, you should report it to the franchisor and relevant regulatory bodies as specified [p.58].
What am I restricted to selling, and where must I buy supplies?
You are restricted to offering and selling only the Products and Services and other items that the franchisor has designated or previously approved for sale at your Store [p.119]. You must obtain these products from the suppliers designated or approved by the franchisor, which may include only the franchisor or a limited group of suppliers they designate [p.3].